Making friends with new ideas – tertiary system reforms at AQF 5-6

While the nation awaits future policy directions on ‘post schooling’ education and training following the outcomes of the 2019 federal election, there are a number of Government initiated reviews and consultations ongoing, as well as other published independent policy proposals. The sense is that the present policy malaise will be heaved along in 2019 by the outcomes of these formal reviews, and by stakeholder ideas expressed in thought-leadership proposals mounting up outside of government.

While these independent industry and expert views may have differing emphases and nuance, they are unanimous in expressing the need for new approaches and urgency in framing reforms of the tertiary education system, especially funding and financing. Table 1 lists key reviews ‘in progress’ (or planned) as well as examples of independent expert-views on new policy directions and ideas.

Table 1 – Current Reviews, Proposals and Commentary on Australia’s tertiary education system

National system/sector reviews	Purpose
VET Review (Joyce Review)	Whole of VET sector review with focus on Commonwealth role, relations and funding
Post-secondary Review – Labor policy	Conditional commitment to a full national inquiry into post-secondary education system in <100 days
Australian Qualifications Framework (AQF) Review	Reconsideration of current AQF and application across all education sectors

 

HE specific consultation/review	Purpose
Performance based funding for Commonwealth Grant Scheme	Rationale of performance-based funding and design principles. Potential to allow HE system growth but not as ‘demand driven’ - now in two year freeze
Review of the Higher Education Provider Category Standards	Reconsideration of the basis of what constitutes an institution being a ‘university’ or higher education provider and requirements definitions
Reallocation of Commonwealth Supported Places enabling sub-bachelor and postgraduate places	Reconsideration of current mechanism for allocation of sub-bachelor and postgraduate places and associated policy conditions

 

Industry/independent  policy commentary	General approach and proposal
Future-proof: Australia’s future post-secondary education and skills system – BCA	Comprehensive tertiary system reforms with focus on unified financing with a capped life-long learner account to provide access to both HE and VET.
Reimagining tertiary education – KPMG	Coherent national educational eco-system, single tertiary funding framework, better integrated tertiary system.
Diversity in Australian tertiary education: turning words into action - NOUS	Tertiary sector reform, proposed transforming regulatory and funding arrangements especially including clearer separation of education and research funding in HE.
Realising Potential – Solving Australia’s tertiary education challenge – AIG	Comprehensive tertiary system reform with focus on independent agency to oversee funding and financing, improved HE/VET sector coordination.

 

These independent commentaries have broad consensus that the HE and VET sectors should cooperatively co-exist, recognising their differing and ideally complementary student-centric, industry, research and employer-connected missions. More far reaching is the ‘binary system’ to ‘tertiary ecosystem’ proposal that sees a future state where the AQF recognises different levels of courses all of which could have theoretical and practical components, with the HE/VET sectoral distinction to go.

Such reforms all require an underpinning of effective foundational enablers supporting an integrated tertiary education system. This includes policies and practices such as: a qualifications framework; international student legislation and policy/visa regimes; HE and VET sector regulation that is separate yet overlaps; and common data standards, systems and student surveys.

Much of this enabling framework is in place (and under review e.g. AQF). These enablers support tertiary system-wide design, common policy standards and platforms, with ripe opportunity for major improvements e.g. integrated data standards, common student surveys and identifiers.

The standout exception and tertiary system failure is funding and financing. HE by way of financing (its resources and associated policy and programs) is operationally and fiscally controlled by the Commonwealth. VET has federated arrangements where funding and associated policy/programs has both separate and shared jurisdictional responsibilities. This gives rise to fertile opportunity for cost shifting. All independent commentary points to VET’s steady and steep de-funding relative to HE, its funding complexity and obscurity, and for students, unequal access and opportunity. One proposed tertiary-wide solution is a student-centric capped lifelong skills/learner account.

Any proposals to address steadily declining VET funding that the university sector senses may be to their detriment is rebuffed. Equally, were the Commonwealth to overstep its present federated role in VET, this might meet resistance by states and territories, despite the steady withdrawal of funding notable since about 2013 (but with modest funding increases in 2017 in some states).

The impact is most evident in a trend decline in government-funded VET, as confirmed by the Productivity Commission in its Report on Government Services, such factors triggering the Joyce Review. One industry peak body, ACPET, now advocates for a Commonwealth takeover of the VET sector within one tertiary education system.

A specific example of policy entanglement and funding complexity is evident at the HE/VET sector ‘boundary’ that spans AQF levels 5-6. The boundary has been characterised as confused, contested and collaborative and displays the disconnected program duality of Commonwealth funding, one for funding HE AQF 5-6 sub-bachelor courses and one for financing of VET AQF 5-6 diplomas (which states and territories also separately fund or may part subsidise student loans).

An edifice of legislative, policy and funding complexity has been built up over time that separately supports HE and VET at what is notionally the same AQF level, albeit providing qualifications serving up to now mostly different purpose.

Such differences however maybe narrowing by the Commonwealth’s HE policy intent of ensuring HE sub bachelor courses have clear ‘focus on industry needs’ and ‘fully articulate’ into higher university AQF programs (pathways that VET qualifications at AQF 5-6 levels can likewise support). These are arguments for HE courses to greater include attributes long espoused as VET’s core purpose. The relevant review (Table 1) has its basis in reallocation of existing enabling places for HE sub-bachelor courses. Reallocation only reinforces past gridlock in siloed thinking about HE and VET.

It’s time to make friends with new connected ideas and to constructively step over old shadows.

Proposal 1 – Allow VET Diploma accredited courses as optional alternate to training package Diploma qualifications.

As noted in ASQA’s 2017/18 Annual Report “about 80 per cent of Australian VET is delivered through training packages, but the Australian VET system also uses accredited VET courses. These are nationally recognised qualifications that are intended to meet industry requirements for training”. Proposal 1 would retain ‘primacy’ of training package qualifications for Certificate IV and below.

Proposal 2 – Allow high quality VET providers to gain prompt course accreditation approvals from ASQA for institutionally-created VET AQF 5-6 courses.

Proposal 1 and 2 are co-dependant. Initially, existing approved VSL providers would be eligible. ASQA’s responsiveness is set by its service standards for assessing and responding to course initial accreditation applications of which there were 110 either received, completed or approved in 2017/18, mostly within one to six months (depending on risk profile and process).

Proposal 3 – Consistent with TEQSA’s policies for highest quality non-university HE providers to earn self-accreditation, allow the same privilege for highest quality VET providers of proven governance and performance by application to ASQA, but only for VET AQF 5/6 courses.

As an option and a further quality safeguard, VET providers might be given periods of ‘provisional self-accreditation’ such that they will also have to earn their right to ‘self-assessment’ of such courses, in the interim requiring independent third party assessments.

Proposals 1-3 sets up HE and VET providers on a ‘level playing field’, that is like privileges of educational autonomy, but (for VET providers) only at AQF 5-6 levels. It gives ideally VET providers alternate and greater self-driven adroitness in constructing courses better suited to fast evolving industry and student needs. The option of using VET AQF 5-6 training package qualifications remains if they wish in meeting students/industry needs. For universities and their related colleges, there is no change and course self-accreditation remains.

Proposal 4 – Unify the funding and financing of AQF 5-6 qualifications. The present legislated VSL course list would remain. All AQF 5-6 courses (both VET and HE) accredited by means above would also be approved under the revised legislation for student loans, each funded at levels in accord with evidenced costs in HE and VET sectors and broad field of education clusters. 

This establishes a single Commonwealth AQF 5-6 financing regime for both HE and VET AQF qualifications. Instead of VET Student Loans, create Tertiary AQF 5-6 [HE/VET] Student Loans.

Besides the present legislated VET Diplomas, the Commonwealth would in addition legislate for approval of AQF 5-6 qualifications; either from universities, or HE/VET providers approved by TEQSA/ASQA as ‘self-accrediting; as well as from non-self-accrediting HE/VET providers where their specific courses are approved by TEQSA/ASQA. The quantum for loans would be set as now by fields of education clusters and in accord with evidenced HE and VET institutional costs (that is, no a priory assumption of same institutional costs across sectors and funding equality). There would be uniformly consistent HELP rules for students, including consistency in any loan fees.

The $205 million in grants for HE AQF 5/6 sub bachelor courses paid to 36 universities in 2018 for 18,847 ‘designated places’ would be re-purposed (to off-set loans or for other purposes).

Universities predictably would argue for a ‘full demand’ driven policy but this in any case may yet be curbed even at bachelor level (under the present Government) by restrains or overriding conditions like population growth or performance based measures.

Under the present VET Student Loan legislation it is possible for a departmental Secretary to cap loans at an institution-specific level by imposing conditions of a ‘provider fee limit’ (S.34). From the Commonwealth’s perspective this controls their loan exposure. They could also, or alternately, impose general requirements by legislating course conditions requiring ‘focus on industry needs’ (but importantly exempting foreign language diplomas) and ‘full articulation’.

The upside for universities would be freedom from periodic negotiation and quota accountability of places and operational consistency with bachelor-level funding.

Students get the benefit of a unified and simpler system regarding their HELP obligations with loans potentially flowing into their enrolment at higher AQF levels.

The Commonwealth would benefit by running one program, not two, and exercise both policy and funding implementation controls.

This would require the Commonwealth to step over old VET FEE HELP shadows in opening up Tertiary AQF 5-6 [HE/VET] Student Loans to financing courses that they have not specifically and individually approved to be listed. Rather the Commonwealth would exercise control by setting policies on course requirements regarding ‘industry needs’ and ‘articulation’ and/or by conditional provider-fee limits. The latter could operate broadly at a sectoral or, more acutely, at a provider-specific level. Periodic adjustments in institution-specific loan caps could be performance linked, both to the positive and negative.

Both HE and VET providers would be able to set a total course price to include any ‘student out of pockets’ (but likely capped overall to avoid risks of fee gouging).

Separately, state and territory governments would continue to fund or subsidise VET AQF 5-6 levels for qualifications of their choice, or part subsidise Tertiary AQF 5-6 [HE/VET] Student Loans.

Proposal 5 – New arrangements will have joint oversight of both TEQSA and ASQA.

Regulatory oversight would be strengthened. The regulators would operate a joint task force in course accreditation, any self-accreditation applications and ‘in the field’ quality compliance. This implies regulators’ would have shared data systems and some joint staff and training. Rectifications and sanctions would remain the province of the either ASQA or TEQSA consistent with the specific VET/HE qualification(s) in dispute and the providers (main) registration.

Proposal 6 – Unify all HELP policy, associated systems and administration at AQF 5/6 levels

The current duality and costs of Commonwealth policy, systems and administration would be potentially simplified. Differences in any loan service fees would be eliminated. To test this proposal, an examination of net administration cost outlays/savings and modelling of new alternates would be made, with any savings reinvested into offset of student loans. Benefit/cost burdens for both provider institutions and any impacts especially on students would likewise need to be tested.

Proposal 7 – Actively track the outcomes by way of subsequent student pathways either to work and/or into higher learning. In addition track diversity and quality of course offerings.

Qualifications being offered across the market would need to be monitored over time, those of high use or specialist need, detailing student pathways, employment and/or further education benefits.

Clearly, the above proposal is dependent on the advice from Australian Qualifications Framework Review which might recommend specific changes/abolishing the distinction at these levels anyway.

There is arguably a risk that over time implementing the above will erode the differences between VET and HE and make a bland blancmange of all AQF 5-6 levels - perhaps. However, the unification of financing mechanisms of AQF 5/6 qualifications need not diminish the discrete purposes and differences between them (and this can be monitored). Indeed diversity is the desired outcome.

Consider the logic of the nation’s Chief Scientist and the benefits of the ‘T-shaped graduate’. The Chief Scientist accepted graduates need deep discipline knowledge, education, training and skills (depth of I in T shape) as well as expansive enterprise or so-called ’softer’ skills (breadth of ^---- in T shape). His strident warning was however of the balance between the two, and that enterprise skills (such as critical thinking, problem solving, emotional intelligence etc.) are not somehow magical replacement for credible and assessed discipline knowledge and research skills (such as in STEM).

This caution echoes the sentiment in the maxim ‘to break the rules you must first master them’. Mastery is just as relevant in education and inquiry as it is in applied knowledge and trades.

As noted recently[1], Aristotle’s analysis in 350 BC helpfully classified three types of knowledge: knowing why (knowledge, inquiry and research), knowing how (application, practice and craft) and knowing what to do (accumulated wisdom and experience gleaned from practice). Graduates and employees need a dose of all knowledge-sources best relevant to their role. Subject to unflinching quality standards, Australia needs a ‘tertiary education system based on a qualifications framework that is freed up to allow providers to cultivate in their own way blends of all three such knowledges’.

Under the proposed regime institutions can then be left to decide their own stand-point of competitive excellence and major emphasis in delivering T-shaped graduates. Students likewise can pursue options as they may wish with equal access and facility.

And the thing about new ideas is that they can get knocked over by even better ideas – best friends to stride over old shadows.

Dr Craig Fowler is an analyst and observer of national policies impacting tertiary education, science and innovation after decades of experience in private, public and university sectors.

[1] ‘Aristotle knew what worked’ Prof. Stephen Parker Education Partner KPMG The Australian Higher Education Dec 12 2018

 

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